Smart devices or digital products are appliances that are connected to the internet. Think of lighting you can switch on and off using an app on your phone, printers, CCTV cameras, baby monitors, and apps and streaming services. It makes no difference if your product is new, used, or imported: the new rules apply to all digital products.
When is an update required?
A second-hand washing machine with wifi: is that a digital product? Yes, it is! So, when you sell this used washing machine as an entrepreneur, you have to supply functional or security updates. And this does not just apply to sellers of white goods or other household appliances with wifi. Manufacturers and traders in digital services or products with digital content, or a digital component, also have to follow the new rules. E-publications, streaming services, and even audio files: all are covered by the new legislation. However, an update is not required if you can reasonably expect that the product or service will continue to perform as it should for a certain period of time.
The law and the legal framework
The required update is part of consumer law. If the update requirement applies to you, be sure to act in accordance with privacy legislation as well. Here is a short summary of your obligations under consumer law, the update requirement, and privacy regulations.
- Your customers are entitled to a product that functions as it should. Your product should have properties they expect, for a period of time they expect. Your ad claim counts as a promise. If you promise that the security camera you sell will function for 10 years, it has to function for 10 years. If it does not, your customer can make a claim based on the statutory guarantee.
- How well a digital product or service performs often depends on software updates. As a seller, you are required to supply software updates, so that the product continues to work as it should. Do you sell a smart fridge to a customer, and does it break down sooner than expected? A broken door is probably not the result of a failure to update, but a software error may well be. If your customer lodges a complaint with ACM, they will start an investigation. If it turns out a lack of required updates caused the problem, you risk a fine. Even if you are not the manufacturer of the product. So, sellers of imported or second-hand appliances also need to provide updates or risk a fine.
- If you offer a software update to your customer, do so in accordance with GDPR rules. If you inform your customers by email, they need to give you permission to store their personal details and use them for this purpose.
- As of 27 April 2022, customers who pay by providing their personal data have the same rights as customers who pay using money. Say you offer a free app in an app store. Your customers register using their email addresses. This is considered payment. And so you are legally required to supply the software updates to update the app, so that it continues to work properly.
Find out if an update is required
Are you not sure if you need to supply an update? Ask yourself the following questions:
- Is your product vulnerable to attacks by hackers?
- Have there been developments in the systems your software uses? For example: you sell an app for smartphones, but the smartphone operating system is updated. Your app may not be able to communicate with the updated OS. In that case, you need to update your app.
If the answer to either of these questions is yes, it is time for an update.
Is the software of your product developed by a supplier? You are responsible for the update, unless your guarantee terms state that you are not.
Does your product or service not work? The consumer can file a complaint with ACM. An investigation may follow. Are faulty updates the cause of the problem? You can get a fine. Even if the complaint does not result in an investigation, you risk reputation damage.
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